Good morning [%first_name |Dear Reader%],

Most editions of this newsletter owe their existence to the news cycle, but my recent piece on FMCG packaging was inspired by personal experience (and frustration). And this one traces its origin to a (virtual) newsroom discussion we had at The Ken last month.

We were talking about my colleague Bhumika’s story on direct-t0-consumer (D2C) brands. Specifically, discussing how many of them are now flocking to smaller online marketplaces to reduce their dependence on biggies such as Amazon. And we arrived at this question: what is even D2C?

You might think that few things are more self-explanatory than D2C. Maybe so, but I wasn’t exactly convinced. It got me thinking, and to find the answer, I landed on two brands—one is Indian, the other American. One is known for its affordable headphones, the other for sneakers popular among the Valley’s tech bros. One is set to go public soon, the other listed in November.

Both are celebrated D2C brands.

But only one of them actually is.

boAt, Allbirds, and what exactly is a D2C brand 

Before we get to boAt and Allbirds, let’s see what the generally accepted definition of a D2C brand is.

Here’s consultancy McKinsey:

And here’s data firm CB Insights:

They are both saying the same thing: there’s no one between a D2C brand and its consumer.

But that’s not necessarily true in the Indian context.

Between 2019 and 2021, India saw the emergence of over 500 (so-called) D2C startups, which attracted nearly US$900 million in funding. And since October, three D2C startups, including meat delivery portal Licious and personal care brands MyGlamm and Mamaearth, have become unicorns.

Wearables brand boAt is likely to be India’s fourth D2C to cross US$1 billion in valuation. It will do so not by raising another round of funding from venture capital firms, but by going public. Its parent, Imagine Marketing, filed for a Rs 2,000 crore (~US$260 million) initial public offering in January. Which means a lot more granular data is available for boAt than for any other D2C brand in the country.

Considering it’s a D2C brand, most, if not all, of boAt’s revenue should be coming from its own website, right?